Closing Costs are often More than Home Buyers Expect

[momof5boys]

You are referring to mortgage life insurance, which is different. If you want that option, you pay extra for it. I have a friend who took it because if something happens to one of them, the survivor is in big trouble financially. Dh and I try to avoid putting ourselves into those types of financial situations. We declined that insurance option as we are betting on both of us surviving long enough to get the mortgage paid off, and not paying for this extra will save us money.

In your friend's case, I am sure this meant one less stress during an incredibly stressful time in her life. Thankfully, this doesn't happen to most of us.

Mortgage insurance is to protect the bank if you default on your mortgage. Mortgage insurance wouldn't be needed on the scale it is currently if banks weren't lending more money to people than they can afford. And CMHC is a government-owned corporation, so you know this means that all tax-paying Canadians are actually subsidizing this to a certain extent.

Thanks for explaining this to me.